What To Do About Bad Credit (2024)

Credit repair

Credit repair is the practice of improving your credit through a variety of methods including correcting errors on your report, consolidating debt, paying down balances, tracking your credit score, and building good habits like keeping your credit balances low and making on-time payments.

Credit report

Your credit report contains a wealth of information about your financial history and actions. If you have credit or loan accounts, those accounts and how you pay them are included in your credit report. It’s important to review your credit report at least once a year so you know what your creditors are saying about you.

Free credit report

A free credit report is a credit report you can access without paying a fee. Services like Credit Karma require you to create an account to view your credit reports from credit bureaus TransUnion and Equifax, but they don’t charge a fee.

Credit check

A credit check is something a lender, bank, or service provider performs when they need to check your financial history. It grants them access to information about your existing and past credit, payment habits, and types of loans so they can assess your risk level as a borrower.

Negative credit history

Having a negative credit history means you have several pieces of negative information on your credit report—a document that contains details of your payment and account history with creditors and lenders.

FICO score

A FICO score is the branded version of credit score most widely used by the nation's largest financial institutions to make credit and loan approval decisions.

Debt collector

A debt collector is a person or company that collects payments for past-due accounts. They may be hired by a business or buy debt from other companies.

Credit repair company

Credit repair companies help people fix inaccurate items on their credit reports. Although you can repair these items on your own, it can help to have a well-trained credit professional work through the process with you. Not only will the best credit repair companies do most of the work for you, but they’ll make sure there aren’t inaccurate items on your report.

Secured credit card

A secured credit card is a card that requires a security deposit to open an account. The card issuer will use the deposit to cover any payments you don’t make, and your credit limit is usually equal to your deposit. These cards typically have stripped-down benefits and only a few offer rewards.

Good credit

In general, credit scores of 700 or higher are considered “good credit” scores. Good scores tend to provide more opportunities for better lending terms, including lower interest rates. Two steps toward good credit include making on-time payments and keeping your balances low.